How does transfer fee work in league football? How does this relate to player’s salaries and what does it mean to go on a loan to another club?
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So every player in professional sports signs a contract with an individual club. This contract among other things says if this person plays whatever sport, they can only play it for this team. (European clubs sometimes cover multiple sports, but let’s keep it simple).
So essentially you say to the club I will exclusively play soccer for you for x years for y dollars. In the simplest terms a transfer fee is what a different club would pay your current club to own your contract. This is separate and distinct from your salary and number of years you’re obligated to play. So for example if you see Messi’s transfer fee was like 100 million, that’s the amount the team buying him paid the other club for the right to pay Messi to play. In general the player doesn’t get any of that money. (Contracts being what they are you can contract for most things absent a CBA or laws but let’s keep this simple).
You see this done in American sports with trades, but it can be done with money in most sports too it’s just not common.
If a players contract expires in general they are free to sign with any other team and that team in general wont pay a transfer fee. You’ll see this listed as a free transfer.
So then you get to loans. The purpose of loans is a team wants to keep a player for the future but doesn’t have space for them now, or a team wants a player but doesn’t want a full commitment to the player. In European leagues there is a thing called promotion/relegation. So the top teams in a lower league get to move up and the bottom teams in the higher league move down.
So let’s say 2nd division team is doing well but needs a striker, an upper division team has a young promising striker, but currently he’s at best a substitute if he even dresses for their team. They like his future but he needs to improve. They’ll make a deal with the second division team to loan him, this way he gets play time, and they keep his rights for the next year(s). This benefits the 2nd division team because they now have a player that might be better than their current strikers. They pay all or part of the player being loaned salary depending on the agreement.
Again there is tons of nuance but that’s the basics
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